Stiglitz: US employment recovery ‘not on the cards’

The US economic recovery won’t be strong enough to curb rising unemployment in the next two years, Nobel laureate Joseph Stiglitz said.

“Some people are declaring victory—the recession is behind us,” Stiglitz said at an event in Pittsburgh sponsored by critics of globalization before tomorrow’s meeting of the Group of 20 nations. “The fact is that the unemployment rate is still high—likely to go up—and for these individuals the recession is not over”
US President Barack Obama, UK Prime Minister Gordon Brown and other leaders are converging on Pittsburgh as the global economy shows signs of rebounding from the worst recession since World War II. G-20 members will discuss rules to redraw the banking system as well as ways to sustain the recovery.

Stiglitz, who teaches at Columbia University in New York, said the US economy needs to expand at a rate of at least 3.2 percent to create new jobs and that performance is “not on the cards” for 2010 and 2011. The unemployment rate climbed to 9.7 percent in August, its highest point in a quarter-century. The euro region rate is around 9.5 percent.